Major fund manager sends a warning about South Africa
Coronation has warned that South Africa’s savings industry continues to struggle as the major asset manager records a drop in profit for the year.
In its financial results for the year ended September 30, 2025, Coronation noted that the local savings industry continued its long-term trend of contraction in 2025.
The drop in savings was linked to South African consumers remaining under pressure and unemployment continuing to rise.
The implementation of the Two-pot Retirement System also added to these structural headwinds in the year under review as more South Africans dipped into their nest eggs to fund immendiate needs.
Coronation’s outflows moderated to 5% of average assets under management year-on-year.
However, as a major player in the South African savings market, the company remains exposed to industry trends.
Worryingly, it does not expect to see rapid industry improvements in the foreseeable future.
Despite the challenging backdrop, the company stated that its clients benefited from the combination of strong market outperformance across most of its fund range.
The company recorded R761 billion in total assets under management, stating that its clients received strong returns despite the challenging economic environment.
It highlighted the inauguration of the new administration in the United States in January 2025, which created immense uncertainty in capital markets.
“The significant shifts in geopolitical alignment and the threat of major trade tariffs added exceptional volatility over the past 12 months,” said Coronation.
“In addition, the rapid development and adoption of artificial intelligence applications have the potential to disrupt many existing industries and create new growth industries, amplifying the uncertainty in equity markets.”
On the domestic front, the protracted 2025 National Budget approval process elevated local volatility.
However, Coronation said that the budget ultimately being passed in May should strengthen the nation’s new political framework in future.
Financials
Fund management earnings per share (excluding the impact of the SARS matter) were up 12% year on year (y/y) at 452.2 cents per share.
Revenue from fund management was up 10% due to management fee growth of 11% and performance fee growth of 3%.
Total assets under management (AUM) increased by 14% to R761 billion, driven by strong outperformance across its fund range.
However, the group’s profit for the year dropped by 24% to R1.6 billion amid far higher taxes in the current period. Basic and headline earnings per share also dropped by 25% to 474.3 cents per share.
The group declared a final gross dividend of 254 cents per share (2024: 228.0 cents) from income reserves.
Gross total dividends per share decreased by 20% to 454.0 cents per share, from 566.0 cents per share in the prior corresponding period.
| Description | Reviewed 30 Sep 2015 (R Million) | Audited 30 Sep 2014 (R Million) | % Change |
| Fund management activities | – | – | – |
| Revenue | 4 291 | 3 913 | 10% |
| Other income | 57 | 296 | – |
| Total operating expenses | (2 351) | (2 255) | 4% |
| Results from operating activities | 1 997 | 1 954 | 2% |
| Profit from fund management | 2 051 | 2 017 | 2% |
| Profit before income tax | 2 202 | 2 121 | 4% |
| Income tax (expense)/credit | (526) | 84 | – |
| Profit for the year | 1 676 | 2 205 | (24%) |
| Earnings per share (cents) | – | – | |
| – basic | 474.3 | 630.5 | (25%) |
| – diluted | 474.3 | 630.5 | (25%) |
| Headline earnings per share (cents) | – | – | – |
| – basic | 474.3 | 630.5 | (25%) |
| – diluted | 474.3 | 630.5 | (25%) |
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